THE SUPREME COURT OF THE RUSSIAN FEDERATION CLARIFIED THE CREDITOR’S RIGHT TO APPEAL AGAINST THE JUDICIAL ACTS

The Supreme Court summarized the position related to the creditor's ability to appeal against the judicial acts. It is a matter of challenging the court rulings not only in the bankruptcy case the creditor is directly involved in, but also in other cases involving other creditors.

The reason for the legal justification, as it often happens, was a case of particular legal relationship. The creditor (company) announced the inclusion in the register of the creditors' claims (RCC) to the debtor (company), justifying the amount of debt to it by a court ruling that had been issued earlier.

After that, another creditor (committee) filed a claim for declaring the company bankrupt, simultaneously submitting a complaint against a court ruling confirming the debts of the first creditor in the court of cassation.

However, the court did not accept the complaint, citing the lack of grounds for appeal, since at the time of its submission the application of the creditor in the framework of the bankruptcy of the debtor had only been accepted for trial.

The Committee challenged the dismissal of the complaint in the Supreme Court, which canceled the appeal decision and sent the complaint back for further consideration.

The justification of the Supreme Court is as follows:

1. inclusion in the RCC, based on a previous judicial act, is a simplified procedure for the creditor itself for confirming his or her financial claims against the debtor. At the same time, such a right of one creditor can change the positions in the RCC of other creditors who did not participate in the process, by which an act was issued against a bankrupt debtor in favor of the creditor.   

2. In order to balance the rights of creditors, law enforcement practice gives them the opportunity to participate in each other's debt collection cases. At the same time, the status of the person participating in the bankruptcy case, as well as the right, including the right to appeal judicial acts, appear from the moment the court accepts the creditor's claims in the bankruptcy case for consideration.

This position is included in the Review of the judicial practice of the Supreme Court of the Russian Federation No. 1 for 2020, and the definition of the case can be found here https://kad.arbitr.ru/Document/Pdf/d7f4c3f3-38b3-4cbc-9b51-a4ebc97c38e0/38448879-4e81-4d08-b0f7-a1ce4c316ca8/A56-108378-2018_20191212_Opredelenie.pdf?isAddStamp=True

By the way, the committee succeeded in the case; upon a new consideration of the cassation appeal, the district court canceled the court ruling, justifying the debt of another creditor, thereby recognizing the committee’s right to appeal against a previously issued judicial act.